IPO Watch: Congo miner Central Copper Resources announces plans to list in London

Photo: Central Copper Resources
Copper prices hit an all-time high in May but have been down recently. Photo: Central Copper Resources

Central Copper Resources (CCR), which mines in Congo and Zambia, is gearing up to launch on the London Stock Exchange as copper prices lost ground.

CCR is finalising the documentation and procedures for admission into the exchange's AIM, the market for small and medium size growth companies.

It plans to use the money raised from the IPO to “advance the high grade Mbamba Kilenda copper project in the Congo towards production and to continue high impact exploration” at its Titan project in the Congo and the Lunga project in Zambia.

The funds will go towards direct exploration and evaluation work programmes.

“We believe that we are listing on AIM at a good time in the project life cycles of the portfolio and given the recent performance of the copper price,” said CEO Kevin van Wouw.

Copper prices reached an all-time high in May as commodities markets soared as hopes of a global economic recovery creates demand for raw materials.

Read more: Inflation jitters in UK and US hit FTSE 100

But recently they have been slipping, falling again on Wednesday amid concerns Chinese industrial demand is slowing and as investors wait for clarification from US central bank officials on rate policy, after data showed rising inflation.

‘’Central Copper Resources is well placed to capitalise on the strong demand for copper forecast as the combustion engine is phased out and the adoption of electric vehicles accelerates,” Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown told Yahoo Finance UK.

“Quality copper ore is considered to be in relatively short supply so if the exploration is successful the company would stand to benefit from new mines coming online,” she said

But she warned about the risks of falling prices, and said investors should also be aware "that mining is highly capital intensive and this company does not offer anywhere near the same level of diversification as mining giants such as Glencore (GLEN.L) and Anglo American (AAL.L)."

Meanwhile, London has become home to a number of initial public offerings this year as the City seeks to attract more listings from innovative companies.

A boom in firms listing on the London Stock Exchange powered it to the best first quarter for listings in 15 years.

Watch: What are negative interest rates

By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

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